With the latest statistics suggesting that over 70% of consumers are now opting to use a mortgage broker rather than go directly to a bank for their home loan, let’s ask the question why? What is the difference and is it really worth it?
Sitting down with Josh, Director of Mynt Financial, he gives us some insight into how having a broker on your side can make a huge difference. Josh and his team helped over 600 people last year with their finance and used over 26 different lenders and says, “Brokers simplify the process by leveraging their expertise in banks, policy, loan offerings, and terms. They can discern which options align with your needs and which don’t. Brokers are adept at navigating the financial landscape, knowing precisely where to apply and what documentation is necessary to secure the financing you seek. Ultimately, they facilitate a smoother path to approval, making it more likely for lenders to greenlight your application.”
Josh also says that with brokers having to abide by – ‘The best interest duty (BID)’ this law requires mortgage brokers to act in your best interests when providing credit assistance. “Best Interests Duty requires acting solely in the client’s best interest. While this obligation applies to mortgage brokers, banks are not bound by it, meaning the bank you walk into may prioritise selling their products over what truly benefits you. Unlike brokers, banks may not advise you on the most suitable loan for your needs, remember they only have their products so can not tell you about bank ‘X’ down the road that is more suitable and could save them money.
Best Interests Duty aims to provide clients with comprehensive guidance aligned with their objectives, financial situation, personal circumstances, and unique requirements. I love that we as mortgage brokers are governed by BID – it’s clearly our point of difference and best for the customer”, says Josh.
Before delving into those reasons why use a mortgage broker, let’s clarify the role of a broker. A broker assesses the borrower’s requirements and then surveys multiple finance lenders to find the most suitable loan package tailored to the borrower’s circumstances. Using a mortgage broker offers several advantages over dealing directly with a bank:
Brokers work for you: Unlike banks, brokers prioritise your needs and work to secure the best deal for you, not the lender. They build their reputation on finding the right solutions for individual borrowers.
Access to multiple lenders: Brokers have the freedom to explore loan options from various lenders, offering you a wider range of choices tailored to your situation. This saves you time and increases your chances of loan approval.
Personalised relationships: Brokers focus on building relationships with clients, understanding their unique financial needs across different areas like home, business, and personal finance. This personalised approach ensures you receive tailored advice and solutions.
Time and cost savings: Brokers streamline the loan process by leveraging their expertise and knowledge of lenders and loan products. They can quickly identify suitable options, saving you time, money, and stress by avoiding unnecessary rejections and delays.
Ongoing support: Brokers provide ongoing advice and assistance beyond securing the loan, adapting to your changing needs and ensuring you continue to benefit from their expertise throughout your financial journey.
“It’s really clear that customers are declining to physically visit branches which is causing banks across the country to close up their shops. Customers are becoming more online so I’m excited that brokers will play a big role in helping them navigate the tricky world of mortgages and assist them in comparing and finding the right home loan solution. I would love to think the predictions of people using a mortgage broker is set to rise to 80%, it’s a win for the customer” – Says Josh.
